Final Results

RNS Number : 1267J

Christie Group PLC

25 April 2022

 

25 April 2022

Christie Group plc
Preliminary results for the 12 months ended 31 December 2021

Christie Group plc ('Christie Group' or the 'Group'), the leading provider of Professional & Financial Services (PFS) and Stock & Inventory Systems & Services (SISS) to the hospitality, leisure, healthcare, medical, childcare & education and retail sectors, is pleased to announce its audited preliminary results for the 12 months ended 31 December 2021.

Key points:

· Revenue growth of 45.1% to £61.3m (2020: £42.2m)

· Operating profit of £5.2m substantially ahead of original market expectation for the year

· Sold in excess of 1,000 businesses during the year

· SaaS business experienced strong on-line growth

· Stocktaking division held back by Covid closures

· Pension deficit reduced YOY by £11.1m (55%) to £9.0m (2020: £20.1m)

· Earnings per share rebounded back to 13.71p per share (2020: negative 19.32p per share)

· Final dividend reinstated at 2.0p (2020: nil) to give total in year of 3.0p (2020: nil)

Commenting on the results, David Rugg, Chairman and Chief Executive of Christie Group said:

 "These are excellent results derived from our professional services activities. Our stocktaking businesses are also, post pandemic, generating new business and fair margins. Overall momentum is building as the year progresses. We anticipate another good year weighted, as before, to the second half ."

Enquiries:

Christie Group plc
David Rugg Chairman and Chief Executive	020 7227 0707
Daniel Prickett Chief Operating Officer	020 7227 0700
Simon Hawkins Group Finance Director	020 7227 0700
Shore Capital Patrick Castle / Iain Sexton Nominated Adviser & Broker	020 7408 4090

Notes to Editors:

Christie Group plc (CTG.L), quoted on AIM, is a leading professional business services group with 39 offices across the UK and Europe, catering to its specialist markets in the hospitality, leisure, healthcare, medical, childcare & education and retail sectors.

Christie Group operates in two complementary business divisions: Professional & Financial Services (PFS) and Stock & Inventory Systems & Services (SISS). These divisions trade under the brand names: PFS - Christie & Co, Pinders, Christie Finance and Christie Insurance: SISS - Orridge, Venners and Vennersys.

Tracing its origins back to 1846, the Group has a long-established reputation for offering valued services to client companies in agency, valuation services, investment, consultancy, project management, multi-functional trading systems and online ticketing services, stock audit and inventory management. The diversity of these services provides a natural balance to the Group's core agency business.

The information contained within this announcement is deemed by the Company to constitute inside information for the purposes of Article 7 of the UK Market Abuse Regulation (EU) No. 596/2014 which is part of the UK law by virtue of the European Union (Withdrawal) Act 2018.

For more information, please go to www.christiegroup.com .

CHAIRMAN AND CHIEF EXECUTIVE'S REVIEW OF THE YEAR

Demand, buoyancy and optimism

I am delighted to report our results for the year ended 31 December 2021. We generated an operating profit for the Group of £5.2m from revenue of £61.3m (2020: £4.4m operating loss before restructuring costs from revenue of £42.2m).

These results reflect a return to the level of profitability achieved by us in 2019 from underlying trading activities. Our operating profit for 2021 was achieved from significantly reduced revenue, albeit some £19.1m higher than in 2020.

During the year we repaid all of our £4.7m agreed tax deferral which related to the pandemic lock downs. We also repaid a further £2.0m of our Coronavirus Large Business Interruption Loan Scheme (CLBILS) loan during the year and a further £0.7m has been repaid to date in 2022.

The latest IAS 19 valuation reflected in these accounts records a more than halving in our outstanding pension fund deficits from £20.1m to £9.0m. The outstanding balance is subject to an ongoing deficit repair plan costing approximately £1m per annum, equivalent to an additional dividend of approximately 4 pence per share.

Professional & Financial Services

I am pleased to report a tremendous result for our Professional & Financial Services (PFS) division. An operating profit of £7.6m (2020: £1.9m operating loss) was achieved from revenue of £43.8m (2020: £26.3m). This is our highest profit from the division since 2007 and a profit conversion of 17%.

This excellent profit margin was due, in part, to the move to host events and marketing online where physical interactions were not permitted or would have been ill advised. As a by-product our travel, accommodation and entertaining expenses were minimised. Our marketing included a number of informative and popular webinars, a recent webinar hosting 1,080 participants. Where our offices had to close, our running costs - whilst not eradicated - were significantly reduced. We have budgeted for our costs to return to more normal levels for 2022.

Christie & Co enjoyed an unparalleled period in the respect that there was strong demand for businesses across each trade sector. Where the sector was struggling due to the direct or indirect effects of the pandemic, optimistic buyers saw buying opportunities and the prospect of recovering trade. Robust demand ensured that prices recovered to, or exceeded, pre-pandemic levels.

We adopted a rebalanced and more incentivised remuneration structure, and this saw many individuals achieve record bonuses, which we applaud.

Our sector specialist teams were, without exception, busy creating portfolio mergers & acquisitions in addition to a high volume of individual transactions. Yet again, we sold over a thousand businesses.

I was pleased that Christie & Co were ranked number one overall, based on the number of deals, securing 12 awards in the Hotels & Leisure category for the Estate Gazette's Radius On-Demand 2021 Rankings. This again confirms our continued position as the leading Hospitality broker in Europe.

2021 also saw the resurgence of portfolio valuation assignments. These were notably absent by Christie & Co throughout 2020, who's higher volumes in 2021 were driven by a combination of sale and acquisition due diligence.  Both Christie & Co and Pinders were actively providing valuations in support of bank lending.

Our international network is concentrated on activity in the hotel sector. This sector was particularly hard hit by business closures due to the travel restrictions imposed by the governments concerned. Our international strategy is to progressively lessen our dependency on this single sector whilst maintaining our position as the pre-eminent hotel brokers in Europe.

Pinders carried out a number of condition surveys and capital expenditure reviews for buyers. Prudent buyers realise that it is the total investment which has to generate a satisfactory return, not merely the initial acquisition cost.

Christie Finance, our funding operation, was occupied with completing the last of the Coronavirus Business Interruption Loan Scheme (CBILS) loans subsequently followed by arranging loans under the Recovery Loan Scheme. However, the majority of our work concerned procuring debt for borrowers on free standing commercial terms. We have supported our borrowers with mortgage protection and key man insurance via Christie Insurance.

In instances where a lack of insurers for property and business risks materialise, for buyers, Christie Insurance have deployed broking skills to gain cover thus enabling completions. Rising premiums have in turn ensured that retained commissions increased.

Stock & Inventory Systems & Services

Our Stock & Inventory Systems & Services (SISS) division achieved revenue of £17.5m (2020: £16.0m and 2019: £32.1m) including some £2.4m of furlough support. The year continued to be seriously affected by the pandemic, which resulted in a significant operating loss of £2.4m (2020: £3.2m operating loss).

In retail stock control we experienced the continued rebalancing between work for stores and requests for more work within their supply chains. We anticipate that this trend will continue. More focus and collaboration with clients who wish to partner with us has achieved excellent service delivery for them and satisfactory profit margins for us across all territories.

In our Hospitality & Leisure stocktaking business, Venners, our stocktakers utilisation rate dropped from full utilisation prior to Covid-19 to 50% through 2021 due to closure or disruption to the sector, with volumes remaining reduced in the other periods even when Covid-19 was less prevalent. Following a lock down of 20 weeks in the Spring, our hospitality stocktaking business was recovering as anticipated when the cancelling of numerous Christmas & New Year's Eve celebrations lead to a quieter start to the New Year. Our own staff maintained a high degree of availability, but work was postponed and rescheduled where our clients had insufficient onsite staff available to host stocktaking visits.

Both Retail and Hospitality clients sought assistance with a wide range of support as they suffered staff shortages and recruitment difficulties. Flexible furlough was particularly helpful in 2021 as it permitted down time (days without work) to be government funded whilst volumes rebuilt.

Our software-as-a-service (SaaS) business, Vennersys, now offers a leading, functionally rich product. As such, the system is attracting interest from larger users with more complex requirements. The sales cycle for larger corporates is longer, whilst they evaluate the compatibility of system scope with their existing business operations and future plans. We continue to add additional sites for our portfolio operators as well as standalone single site attractions. We continue to add further niche leisure sectors, supporting venues with their visitors and sales. Recurring income continued to grow for Vennersys, with online revenues almost doubling since 2020.

Looking Ahead

I thank all members of our exceptional teams who have contributed so strongly to ensure our success in the challenging times we have faced together. I welcome the new people who have joined us and those about to join, as we target yet better performance in the years ahead. We are working hard to ensure that our new joiners are fully integrated into teams to facilitate the interactions which are essential for induction, development training and mentoring, whilst retaining the benefit derived from the efficiencies of flexible working. We are committed to supporting our staff from a well-being perspective. Numerous support initiatives are being rolled out across the Group, all with the key objective of ensuring that our staff feel part of a caring and responsible business.

We are starting to experience more operators choosing to sell businesses in order to repay debt. Simultaneously we are enjoying multiple offerors pursuing each business for sale. Strong demand exists across each of our trade sectors.

The invasion in Ukraine is an abhorrent human tragedy and our hearts go out to those impacted. Internationally, our professional practice is well established and if allowed a peaceful existence should contribute positively to our results. As yet, we have been unable to discern the effect on our operations in Austria, Germany and Finland.

Our agencies' pipelines of deals in progress have grown to exceed those of the prior year.

Our stocktaking businesses from this point forward, should not put additional drain on our resources as their activity levels further recover.

Four of our seven trading subsidiary Managing Directors took up their positions at the onset of Covid-19. They have each done well. I know that their plans and actions are producing positive future developments. Our appreciation goes also to your board who together recognise, challenge, encourage and reward success.

We are well funded and anticipate further growth in our working capital as our revenue continues to rebound. Our momentum is building as the year progresses. As usual, we anticipate that our profit achievement will be primarily generated in our second half. Overall, we anticipate another successful year with further growth prospects beyond.

Your directors recommend a final dividend of 2.0p per share (2020: 0.0p), increasing the total dividend to 3.0p for the year (2020: 0.0p). If approved the dividend will be paid on 8 July 2022 to those shareholders on the register on 10 June 2022.

David Rugg
Chairman and Chief Executive
22 April 2022

CHIEF OPERATING OFFICER'S REVIEW

We can reflect on 2021 with a combination of satisfaction, pride and encouragement for the future. The strength of our recovery and renewed momentum is apparent from a £10.2m year-on-year swing in operating profit, and while across the Group we continued to face a variety of challenges and opportunities within our various operations and sectors, the overall result and where that has placed us heading into 2022 was achieved thanks to significant individual and collective contributions from across the spectrum of our teams and businesses.

I commented a year ago that we had seen enough in the second half of an extremely challenging 2020 to be confident that all of our trading brands could be profitable contributors to the Group in future. I am pleased to say that this confidence has only been enhanced by the progress made during 2021.

While our Professional & Financial Services ("PFS") Division delivered an excellent performance, we also reduced our operating losses in the Stock & Inventory Systems & Services ("SISS") Division despite significant disruption to the hospitality, leisure and retail sectors. We are optimistic that a more normalised 2022 trading environment should enable further progress in this regard as we move forwards.

Professional & Financial Services

For Christie & Co, activity levels remained buoyant for the duration of the year, but as is often our experience of deal timing, we saw a stronger second half than the first as many instructions taken several months earlier reached exchange in the latter part of 2021.

We sold just under 1,100 businesses in the calendar year across the UK and Europe, with the volume of sales up 71% on 2020. Given the strength of our agency recovery in the second half of 2020, the scale of this increase reflected the strength of activity across all of our sectors. The growth in the value of businesses sold by Christie & Co was as impressive, increasing by 58% to £1.3bn.

Our Hospitality teams were extremely active, most notably in the UK where we sold 110 hotels in the year. Highlights included acting for Qbic Hotels Ltd in the disposal of their interest in the Qbic London City and the sale by Bayview Italia of the Poggio alla Salla in Tuscany, Italy to Precise Hotels and Resorts. On the continent, we saw the re-emergence of buying appetite from institutional buyers, owner-operators and high-net-worth individuals with second-half improvement in investor sentiment most obvious in Central and Eastern Europe. 

More widely in Hospitality as a whole, we achieved almost 350 exchanges. Our Pubs & Restaurants team supported Red Oak Taverns on their acquisition of 10 freehold tenanted pubs from Hall & Woodhouse, and we also acted on behalf of YUM! in securing Starboard Hotels as the new franchise partner for 27 Pizza Hut delivery sites across the Midlands. Pub sector pricing remained robust through a combination of lack of stock, active corporate buyers and a gradually recovering marketplace after UK Covid-restrictions were lifted in early H2.

In Leisure, we saw encouraging levels of transactional activity, buoyed by holiday parks and outdoor attraction operators. Christie & Co were active throughout the year, including the sale of Skegness Pier to Mellors Group and the sale of Boothferry Golf Club in Yorkshire, on behalf of Aldington Golf Centre Ltd.

Our Care team was as busy as always, completing over 50% of all individually transacted care home deals in the UK during the year. The market saw an evolving landscape, with European investment arriving in the UK including the French healthcare fund, SCPI Pierval Sante, who acquired a group of Care UK investments from Legal & General in a deal brokered by Christie & Co.

At the same time, our Care development, investment and consultancy teams were equally busy. We successfully brokered a pre-let on a high-specification 76 room development in Bedfordshire before then undertaking an associated forward-funded investment sale to a specialist healthcare fund, and we carried out several market studies and needs analysis assignments.

Our Medical team continued to be at the forefront of deal activity, in both the Dental and Pharmacy sectors. In the former, the market continued to consolidate with corporate and mid-sized groups extremely active. We advised on the strategic investment in Real Good Dental by TriSpan as well as the sale of two East Yorkshire Dental Studio practices, consisting of 9 surgeries, to Dentex.

In Pharmacy, the pandemic response stimulated strong sector confidence and deal activity, with highlights including the sale of the 20-strong Pearns Pharmacies group in South Wales to Knights Pharmacy Ltd, and the sale of two South Yorkshire groups, JM McGill Limited and D&R Sharp (Chemists) Ltd.

Our Childcare & Education team had an outstanding year, recovering particularly strongly after a challenging 2020. While activity was spread across the year, many of our larger deals reached a successful conclusion in the last quarter. The sale of Footsteps Day Nurseries to Family First Nursery Group and Oakwood House in Glasgow to Busy Bees were two of several notable transactions exchanged or completed in the latter part of 2021. Buyer demand was arguably as strong as it has ever been in the sector, with the volume of offers received by Christie & Co on businesses for sale up 45% on 2019 levels.

The Retail team experienced a very busy year. Demand for convenience retail assets was extremely strong, with Christie & Co selling 60% more convenience assets in 2021 than 2020. At the same time, the team worked throughout 2021 supporting Co-Op on their multi-phase divestment project so that by the end of the year six tranches of stores had been confidentially marketed.

Pinders, our business appraisal, valuation and consultancy business, remains a key early-stage barometer for assessing activity levels and sentiment. The V-shaped recovery it delivered in 2020 and continued through 2021 was testament to its own standing among lenders and their appetite to support loan applicants that can demonstrate - through a Pinders appraisal - an ability to repay. Pinders issued 26% more appraisal reports in the year than 2020, while increasing its own average fee by 7% in the process. It did so while increasing the number of lenders it works for and maintaining all its pre-existing panel positions. Pleasingly, the business's Consultancy and Building Services divisions also recovered well, with combined 2021 revenues 45% higher than a year earlier.

Christie & Co's own valuation team experienced an even greater recovery in activity. They carried out 51% more valuations in 2021 than 2020, with banks requesting periodic valuations that had otherwise stalled during the previous two years, and saw average fees hold up well in the process.

PFS divisional KPIs	2021	2020
Total businesses sold	1,069	624
% Increase / (decrease) in average fee per business sold	(8.8%)	29.3%
Total value of businesses sold (£m)	1,304	823
Total valuations carried out (units)	3,705	2,642
% increase / (decrease) in average fee per valuation	1.8%	0.8%
Value of businesses valued (£m)	7,622	3,889
% increase in number of loan offers secured	(5.1%)	2.3%
Average loan size (£'000)	457	413

Our finance brokerage business, Christie Finance, delivered another encouraging and progressive year. As the CBILS loan scheme gave way to the less attractive Recovery Loan Scheme, our teams were able to once more focus on commercial mortgage lending as well as sourcing refinance and working capital facilities through its Unsecured team.

Christie Finance completed loans via 37 different lenders in 2021, a 12% increase on its lender coverage a year earlier. This included new lenders only accessible through specialist brokers, with 60% of our commercial mortgage lending being sourced from challenger banks, niche lenders and funds.

Christie Finance's strength in its specialist sectors was further highlighted by its increased success in sourcing finance for Christie & Co business sales clients. The number of completed loans linked directly to a sale brokered by Christie & Co increased by 40% compared to 2020. Further cross-selling with other Group companies continues to be an area of opportunity.

Christie Insurance continued to work alongside Christie & Co and Christie Finance in particular, to secure cover solutions for clients in a market where premiums continued to harden and the appetite among insurers to take on new risk in certain sectors was limited. Ensuring appropriate business and mortgage protection insurance is in place by the date of completion remains a key hurdle to overcome for new business owners.

For more established business property owners, the risk of underinsuring rebuilding costs is a growing risk in a high-premium market, and an issue Pinders and Christie Insurance can work with clients to resolve.

Stock & Inventory Systems & Services

In our retail stocktaking business, Orridge, we continued to experience disruption from the pandemic in both the UK and Europe. In the UK, we were able to use the furlough scheme for the first nine months of the year to varying degrees while at the same time continuing to achieve on-site efficiency gains and service improvements. We further proved our ability to adapt to both short-notice work cessation and large scale resumption, and this allowed us to make progress in reintroducing returning clients, developing and expanding our coverage of existing customer estates, and achieving improved commercial terms.

On the continent, SISS experienced a challenging year. In Germany, we saw a number of clients opting to delay counts, and lower work volumes reduced margins where transport and PPE costs had an effect. Our Benelux operation responded well but could not avoid a subdued performance below its normal pre-pandemic performance. We anticipate a far stronger 2022 as we benefit from more normalised activity levels and the return of a significant pan-European retailer as a client, secured towards the end of 2021.

Our Pharmacy business delivered a return to pre-pandemic financial performance, benefitting from a simplified I.T system and strengthening our Client Relationship team. The buoyant transactional market in the sector also saw our teams servicing a high volume of business sales valuation work. We also made advances in initiating working relationships in the Veterinary sector, while securing sole-supplier status with one of our larger existing clients.

As the pandemic accelerated demand for online-only retailers, we saw growing demand for our supply chain services and distribution stock control services. As we welcomed 14 new clients to our Supply Chain division from across a number of sectors, we also strengthened our operational team.

SISS divisional KPIs	2021	2020
Total stocktakes & audits carried out (number of jobs)	40,341	38,930
% increase in average income per job	3.1%	1.5%
% of visitor attraction client admissions purchased online	62.0%	58.2%

A year ago I referenced our hospitality stock audit, compliance and consultancy business, Venners, as "traditionally profitable" after 10 months of unprecedented disruption to the UK hospitality sector which had resulted in the most untraditional of operating losses for the business. While those sector-related challenges remained much publicised and did not, sadly, vanish at the stroke of midnight on New Year's Eve 2020, I am delighted to be able to comment on a return to profit for the second half of 2021.

The shape of that recovery in performance is illustrated by the number of jobs Venners undertook in the year. The volume of work undertaken in this respect was 2.5 times greater in H2 than in H1; using the same measure Q4 activity was 5.0 times greater than Q1. In a full year context, despite this growing recovery in activity levels, Venners still only undertook 46% of the volume of stock audits in 2021 than it carried out in 2019. There is, simply put, more to come in terms of building back to the level of work undertaken before Covid-19 and the SISS operating loss for 2021 reflects this significant contributory factor.

But our brand remains powerful and the go-to choice for owners and operators who value stock and profit control. Recognising this, the business has continued to progress and invest. Venners launched a new website and rebrand early in 2022 showcasing its ability to continually adapt and re-invigorate, as it celebrated the 125th anniversary of its formation in 1896.

Our team of nearly 140 British Institute of Innkeepers accredited stock auditors remain in place, with a true UK-wide and market leading coverage. Venners continued to win new business in 2021, adding Tortilla, Creative Leisure and Amaris Hospitality as clients, among others. As the business moves through the first quarter of 2022, it is beginning to see the return of demand for observational audits and other compliance and consultancy services, to complement the earlier and more visible level of returning demand for stock audits in pubs, restaurants and hotels.

Our SaaS business, Vennersys, which provides ticketing and visitor-management solutions for UK visitor attractions, delivered another year of strong growth despite the disruption from the pandemic which continued to impact the tourism & leisure sector in the UK, particularly in the first half. A strong pipeline of pending installs as we began the year meant we were able to maintain momentum in the first quarter despite this, before visitor numbers began to return to UK venues which itself then translated into much improved footfall-related revenues for us as the year progressed. At the same time, we saw the proportion of our clients' total admissions income taken online increase to 62.0% (2020: 58.2%), further highlighting the benefits of our Venpos Cloud system.

Indeed, our online revenues grew year on year by 86%, underpinning a slightly more modest 65% increase in overall revenues inclusive of licences, hardware and consultancy income. As client and installed EPOS numbers continued to grow year-on-year, we added new clients across a range of sectors, including The Vindolanda Trust, Dairyland Farm Park and Tweddle Animal Farm.

We continue to partner a dynamic, talented and growing team who have a passion for delivering a first-class customer experience for visitor attractions, with continued investment in our Venpos Cloud product which continues to evolve to meet the requirements of more complex, larger clients.

Summary

As we ended 2021 and began 2022, our focus and commitment remain on being the service provider of choice to our clients in our chosen sectors. We have demonstrated a resilient and flexible ability to do this through our teams and their impressive sector-specific knowledge and client-centric focus. We continue to recognise the importance of technology in enabling our people to provide excellent service delivery, as well as helping us achieve greater levels of synergy and cross-selling.

All of our businesses continue to provide services aimed at adding value for our clients throughout their own business's life cycle. The performance of our PFS division in 2021 illustrates the strength of this demand starkly; when businesses in our sectors and markets are able to trade without curtailment, we perform well. The pleasing and welcome return to profitable trading in our hospitality stock audit business in the second half of 2021 only serves to emphasise this point, as do encouraging signs of improving sales activity in our retail stocktaking operations. Our SaaS business continues to grow.

Once again therefore, we can look forward to the year ahead with enthusiasm and an undimmed confidence in our people and the quality of service they provide.

Dan Prickett

Chief Operating Officer

22 April 2022

CONSOLIDATED INCOME STATEMENT
For the year ended 31 December 2021

	Note	2021 £'000	2020 £'000
Revenue	2	61,252	42,224
Other income - government grants	3	2,592	8,182
Employee benefit expenses		(44,332)	(40,338)
		19,512	10,068
Impairment release/(charge)		14	(120)
Other operating expenses		(14,332)	(14,303)
Operating profit/(loss) before restructuring costs		5,194	(4,355)
Restructuring costs	4	-	(672)
Operating profit/(loss) post restructuring costs		5,194	(5,027)
Finance costs		(1,329)	(1,316)
Finance income		26	4
Total finance costs		(1,303)	(1,312)
Profit/(loss) before tax		3,891	(6,339)
Taxation		(316)	1,277
Profit/(loss) after tax		3,575	(5,062)
Profit/(loss) for the period after tax attributable to:
Equity shareholders of the parent		3,575	(5,062)
Earnings per share
Basic	6	13.71	(19.32)
Diluted	6	13.34	(19.32)

All amounts derive from continuing activities.

The accompanying notes are an integral part of these preliminary results.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

For the year ended 31 December 2021

				2021 Total £'000	2020 Total £'000
Profit/(loss) after tax				3,575	(5,062)
Other comprehensive income:
Items that may be reclassified subsequently to profit or loss:
Exchange differences on translating foreign operations				100	(34)
Net other comprehensive income/(losses) to be reclassified to profit or loss in subsequent years				100	(34)
Items that will not be reclassified subsequently to profit or loss:
Actuarial gains/(losses) on defined benefit plans				13,181	(8,052)
Effect of asset ceiling				(1,788)	-
				11,393	(8,052)
Income tax effect on defined benefit plans				(2,089)	1,770
Income tax effect of asset ceiling				447	-
				(1,642)	1,770
Net other comprehensive income/(losses) not being reclassified to profit or loss in subsequent years				9,751	(6,282)
Other comprehensive income/(losses) for the year net of tax				9,851	(6,316)
Total comprehensive income/(losses) for the year				13,426	(11,378)

Total comprehensive income/(losses) attributable to: Equity shareholders of the parent

13,426

(11,378)

CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY

As at 31 December 2021

	Share capital £'000	Other reserves £'000	Cumulative translation reserve £'000	Retained earnings £'000	Total equity £'000
Balance at 1 January 2020	531	5,443	620	(6,628)	(34)
Loss for the year after tax	-	-	-	(5,062)	(5,062)
Items that will not be reclassified subsequently to profit or loss	-	-	-	(6,282)	(6,282)
Items that may be reclassified subsequently to profit or loss	-	-	(34)	-	(34)
Total comprehensive losses for the year	-	-	(34)	(11,344)	(11,378)
Movement in respect of employee share scheme	-	(27)	-	-	(27)
Employee share option scheme
- value of services provided	-	46	-	-	46
Dividends paid	-	-	-	-	-
Balance at 31 December 2020	531	5,462	586	(17,972)	(11,393)
Profit for the year after tax	-	-	-	3,575	3,575
Items that will not be reclassified subsequently to profit or loss	-	-	-	9,751	9,751
Items that may be reclassified subsequently to profit or loss	-	-	100	-	100
Total comprehensive profit for the year	-	-	100	13,326	13,426
Movement in respect of employee share scheme	-	(278)	-	-	(278)
Employee share option scheme
- value of services provided	-	62	-	-	62
Dividends paid	-	-	-	(260)	(260)
Balance at 31 December 2021	531	5,246	686	(4,906)	1,557

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

At 31 December 2021

				2021 £'000	2020 £'000
Assets
Non-current assets
Intangible assets - Goodwill				1,800	1,855
Intangible assets - Other				1,043	1,038
Property, plant and equipment				1,346	1,819
Right of use assets				5,106	5,774
Deferred tax assets				3,460	5,114
Other receivables				2,555	2,263
				15,310	17,863
Current assets
Inventories				15	24
Trade and other receivables				12,502	10,624
Current tax assets				946	976
Cash and cash equivalents				8,167	10,284
				21,630	21,908
Total assets				36,940	39,771
Equity
Share capital				531	531
Other reserves				5,246	5,462
Cumulative translation reserve				686	586
Retained earnings				(4,906)	(17,972)
Total equity				1,557	(11,393)
Liabilities
Non-current liabilities
Trade and other payables				546	50
Retirement benefit obligations				8,997	20,136
Lease liabilities				7,488	7,999
Borrowings				1,000	3,000
Provisions				1,352	1,004
				19,383	32,189
Current liabilities
Trade and other payables				10,863	13,316
Lease liabilities				1,170	1,296
Current tax liabilities				299	-
Borrowings				2,568	3,206
Provisions				1,100	1,157
				16,000	18,975
Total liabilities				35,383	51,164
Total equity and liabilities				36,940	39,771

CONSOLIDATED STATEMENT OF CASH FLOWS

For the year ended 31 December 2021

	Note	2021 £'000	2020 £'000
Cash flow from operating activities
Cash generated from operations	7	3,197	2,503
Interest paid		(982)	(1,081)
Tax received/(paid)		96	(197)
Net cash generated from operating activities		2,311	1,225
Cash flow from investing activities
Purchase of property, plant and equipment		(147)	(899)
Proceeds from sale of property, plant and equipment		22	15
Intangible asset expenditure		(388)	(184)
Interest received		26	4
Net cash (used in) investing activities		(487)	(1,064)
Cash flow from financing activities
Proceeds from bank loan		-	6,000
Repayment of bank loan		(2,000)	(1,000)
Repayment of other loan		-	(910)
Drawdown/(repayment) of invoice finance		81	(476)
Repayment of lease liabilities		(1,036)	(825)
Dividends paid		(260)	-
Net cash (used in)/generated financing activities		(3,215)	2,789
Net (decrease)/increase in cash		(1,391)	2,950
Cash and cash equivalents at beginning of year		9,565	6,625
Exchange gains on euro bank accounts		(7)	(10)
Cash and cash equivalents at end of year		8,167	9,565

The accompanying notes are an integral part of these preliminary results.

NOTES TO THE PRELIMINARY ANNOUNCEMENT

1.  BASIS OF PREPARATION

The financial information set out in this announcement does not comprise the Company's statutory accounts for the years ended 31 December 2021 or 31 December 2020.  

The financial information has been extracted from the statutory accounts of the Company for the years ended 31 December 2021 and 31 December 2020. The auditors reported on those accounts; their reports were unqualified.

The statutory accounts for the year ended 31 December 2020 have been delivered to the Registrar of Companies, whereas those for the year ended 31 December 2021 will be delivered to the Registrar of Companies following the Company's Annual General Meeting.

While the financial information included in this preliminary announcement has been prepared in accordance with the recognition and measurement criteria of International Financial Reporting Standards (IFRSs), this announcement does not itself contain sufficient information to comply with IFRSs. The Company expects to publish full financial statements that comply with IFRSs in June 2022.

These policies have been consistently applied to all years presented, unless otherwise stated. 

2.  SEGMENT INFORMATION

The Group is organised into three main operating segments:  Professional & Financial Services (PFS), Stock & Inventory Systems & Services (SISS) and Other.

The segment results for the year ended 31 December 2021 are as follows:

	PFS £'000	SISS £'000	Other £'000	Group £'000
Total gross segment sales	43,882	17,480	3,454	64,816
Inter-segment sales	(110)	-	(3,454)	(3,564)
Revenue	43,772	17,480	-	61,252
Operating profit/(loss)	7,565	(2,371)	-	5,194
Finance costs	(843)	(239)	(221)	(1,303)
Profit/(loss) before tax	6,722	(2,610)	(221)	3,891
Taxation				(316)
Profit for the year after tax				3,575

The segment results for the year ended 31 December 2020 are as follows:

	PFS £'000	SISS £'000	Other £'000	Group £'000
Total gross segment sales	26,320	16,014	3,123	45,457
Inter-segment sales	(110)	-	(3,123)	(3,233)
Revenue	26,210	16,014	-	42,224
Operating loss	(1,863)	(3,164)	-	(5,027)
Finance costs	(824)	(227)	(261)	(1,312)
Loss before tax	(2,687)	(3,391)	(261)	(6,339)
Taxation				1,277
Loss for the year after tax				(5,062)

Revenue is allocated below based on the entity's country of domicile.

	2021 £'000	2020 £'000
Revenue
Europe	61,202	42,174
Rest of the World	50	50
	61,252	42,224

3.  OTHER INCOME - GOVERNMENT GRANTS

The Group has benefited from the Government support due to the Covid-19 business disruption, utilising the furlough scheme from its commencement which has provided financial assistance towards employee salaries in 2021. During 2021, £2,592,000 (2020: £8,182,000) Government grants have been recognised in the Consolidated Income Statement, under the category Other income - government grants.

4.  RESTRUCTURING COSTS

	2021 £'000	2020 £'000
Restructuring costs	-	672
	-	672

During the year, the Group incurred restructuring costs of £nil (2020: £672,000), including £nil (2020: £628,000) of employee related termination costs.

5.  DIVIDENDS

A dividend in respect of the year ended 31 December 2021 of 2.00p per share (2020: 0.00p), amounting to a total dividend of £520,000 (2020: £nil) is to be proposed at the Annual General Meeting on 15 June 2022.

In the year the Group paid an interim dividend of 1.00p per share (2020: 0.00p) totalling £260,000 (2020: £nil).

6.  EARNINGS PER SHARE

Basic earnings per share is calculated by dividing the profit attributable to equity holders of the Company by the weighted average number of ordinary shares in issue during the year, which excludes the shares held in the Employee Share Ownership Plan (ESOP) trust.

	2021 £'000	2020 £'000
Profit/(loss) attributable to equity holders of the Company	3,575	(5,062)
	Thousands	Thousands
Weighted average number of ordinary shares in issue	26,071	26,220
Adjustment for share options	729	843
Weighted average number of ordinary shares for diluted earnings per share	26,800	27,063
	Pence	Pence
Basic earnings per share	13.71	(19.32)
Diluted earnings per share	13.34	(19.32)

7.  NOTES TO THE CASH FLOW STATEMENT

Cash generated from operations	2021 £'000	2020 £'000
Profit/(loss) for the year after tax	3,575	(5,062)
Adjustments for:
Taxation	316	(1,277)
Finance costs	1,303	1,096
Interest received	-	-
Dividends received	-	-
Depreciation	1,599	1,818
Amortisation of intangible assets	383	390
Impairment of investments in subsidiaries	-	-
Profit on sale of property, plant and equipment	(14)	(5)
Increase in provisions	291	328
Payments to ESOT	(175)	-
Foreign currency translation	143	45
Share option charge	62	46
Movement in retirement benefit obligation	(168)	(143)
Movement in non-current other receivables	(292)	(362)
Movement in working capital:
Decrease in inventories	9	11
(Increase)/decrease in trade and other receivables	(1,878)	4,290
(Decrease)/increase in trade and other payables	(1,957)	1,328
Cash generated from operations	3,197	2,503

8.  POST BALANCE SHEET EVENT

On 24 February 2022, Russian military forces entered Ukraine. We confirm that we have since carried out an assessment of the potential impact of this military conflict on the trading activities of each subsidiary in the Group, including the impact of mitigation measures and uncertainties. The precise impacts on our trading outlook for 2022 and longer term remain uncertain and may remain so as long as the war continues, although to the extent that any impact arises or has already arisen, we would currently anticipate that the most likely impact will be on those operations within our Professional and Financial Services Division where the pace and progress of transactions may be affected by ongoing war in the region. In the event of military conflict in Ukraine extending beyond those country borders and into central and Eastern Europe, all of our businesses - both in the UK and Internationally - are not immune to the direct and indirect macro-economic consequences of war in any country or continent in which we operate.

Report and Accounts

Copies of the 2021 Annual Report and Accounts will be posted to shareholders in May.  Further copies may be obtained by contacting the Company Secretary at the registered office.  Alternatively, the 2021 Annual Report and Accounts will be available to download from the investors section on the Company's website www.christiegroup.com  

Key dates

The Annual General Meeting of the Company is scheduled to take place at 10.00am on Wednesday 15^th June 2022 at Whitefriars House, 6 Carmelite Street, London, EC4Y 0BS. 

Group Companies

Professional & Financial Services

Christie & Co

Christie & Co is the leading specialist firm providing business intelligence in the hospitality, leisure, healthcare, medical, childcare & education and retail sectors. A leader in its specialist markets, it employs the largest team of sector experts in the UK & Europe providing professional agency, valuation and consultancy services.

www.christie.com  

Christie Finance

Christie Finance has 40 years' experience in financing businesses in the hospitality, leisure, healthcare, medical, childcare & education, retail and medical sectors. Christie Finance prides itself on its speed of response to client opportunities and its strong relationships with finance providers.

www.christiefinance.com

Christie Insurance

Christie Insurance has over 40 years' experience arranging business insurance in the hospitality, leisure, healthcare, medical, childcare & education and retail sectors. It delivers and exceeds clients' expectations in terms of the cost of their insurance and the breadth of its cover.

www.christieinsurance.com

Pinders

Pinders is the UK's leading specialist business appraisal, valuation and consultancy company, providing professional services to the licensed, leisure, retail and care sectors, and also the commercial and corporate business sectors. Its Building Consultancy Division offers a full range of project management, building monitoring and building surveying services. Pinders staff use business analysis and surveying skills to look at the detail of the businesses to arrive at accurate assessments of their trading potential and value.

www.pinders.co.uk

Stock & Inventory Systems & Services

Orridge

Orridge is Europe's longest established stocktaking business specialising in all fields of retail stocktaking including high street, warehousing and factory operations, pharmacy and supply chain services. It also has a specialised pharmacy division providing valuation and stocktaking services. Orridge prides itself in its ability to deliver high-quality management information to its clients effectively and conveniently.

www.orridge.eu

Venners
Venners is the leading supplier of stocktaking, inventory, consultancy & compliance services and related stock management systems to the hospitality sector. Consultancy & compliance services include control audits and live event stock taking. Bespoke software and systems enable real-time management reporting to customers using the best available technologies. Venners is the largest and longest established stock audit company in the sector in the UK.

www.venners.com

Vennersys
Vennersys operates in the UK and deliveries online Cloud-based ticketing sales and admission Systems to visitor attractions such as historic houses and estates, museums, zoos, safari parks, aquaria and cinemas. It has over 25 years' experience delivering purpose-designed solutions for clients' ticketing, admissions, EPoS and food and beverages sales requirements.

www.vennersys.co.uk

 

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